The rate of joblessness in the U.S. has fallen to a new 7-year low, with employers adding 223,000 jobs in April — a solid gain that suggests growing confidence that the economy may be recovering after stumbling at the start of the year.
The Labor Department said Friday that the unemployment rate dipped to 5.4 percent from 5.5 percent in March. It represents the lowest rate since May 2008, six months into the Great Recession.
Yet the report included some sign of residual sluggishness: March's weak job gain was revised sharply down to just 85,000 from 126,000. In the past three months, employers have added 191,000 positions, a decent gain but down from last year's average of 260,000.
And job growth isn't yet boosting paychecks much. Average hourly wages rose just 3 cents in April to $24.87. Wages have risen 2.2 percent in the past 12 months, about the same modest year-over-year increase as in the past six years.
Nonetheless, the employment report suggested underlying strength in the economy at the start of the second quarter after growth braked to a near halt in the first three months of the year.
The economy wobbled in the first quarter and may have even contracted as it was buffeted by bad weather, port disruptions, a strong dollar and deep spending cuts by energy firms.
The drop in the unemployment rate pushed it within a whisker or two of the 5.0 percent to 5.2 percent range that most Fed officials consider consistent with full employment.
Even more encouraging, the labor force participation rate, or the share of working-age Americans who are employed or at least looking for a job, rose 0.1 percentage point to 62.8 percent last month. Other measures on the Fed's so-called dashboard also improved further.
A broad measure of joblessness that includes people who want to work but have given up searching and those working part-time because they cannot find full-time employment fell to 10.8 percent, the lowest level since August 2008, from 10.9 percent in March.
The number of long-term unemployed also continued to fall.